4.4 Flashcards
Balance of payment
A record of all transactions associated with imports and exports and all international capital movements
FDI flows
The transfer of funds by an MNC to purchase and acquire physical assets such as factories or machines
MNC
A multi national company i.e. a business that operates in more than one country
Transfer pricing
A system operated by MNC’s. It is an attempt to avoid relatively high tax rates through the prices which one subsidiary charges another for components and finished goods
Child labour
The employment of children to undertake business activity
Emmisions
A substance that is produced and sent out into the air that harms the environment
Exploitation of labour
When an agent takes advantage of another agent e.g.an employer abusing an employee
Supply chain consideration
The way a business treats and monitors the labour involved in the production of raw materials, components and services
Sustainability
When a business is able to meet present needs without damaging or compromising the needs of the future
Waste disposal
The process of getting rid of unwanted materials
Competition policy
Government policy that exists to promote competition and ensure that firms don’t abuse their market power, do not attempt to fix prices or use pricing strategies to drive out competition
Tax avoidance
Using legal methods to reduce the amount of tax that a company pays
Tax evasion
Using illegal methods to avoid paying taxes that are owed
WTO
The World Trade Organisation that supervises world trading arrangements and trade negotiations and promotes the benefits of free trade
